It is known from U.S. Pat. No. 4,454,322 to prepare 2-benzoxazolone or substituted 2-benzoxazolones by reaction of ortho-nitrophenol or a substituted ortho-nitrophenol with carbon monoxide in the presence of a palladium compound, a transition metal and a hetero-aromatic base such as pyridine or quinoline. The catalytic system works only at rather high pressures and temperatures, e.g. at 200.degree. C. and between 150 and 350 bar.
It has now been found that with specific palladium catalyst compositions excellent yields can be obtained under rather mild reaction conditions.